Srcm Co-Operative Housing Society ... vs Department Of Income Tax

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: 'G' NEW DELHI BEFORE SHRI R. S. SYAL, ACCOUNTANT MEMBER AND SHRI H. S. SIDHU, JUDICIAL MEMBER I.T.A .No.-532/Del/2012 (ASSESSMENT YEAR-2008-09) JCIT Vs. M/s SRCM Co-operative Range-2, Housing Society Ltd., Ghaziabad. SJ-1, Shastri Nagar, Ghaziabad. PAN: AACAS4666H (APPELLANT) (RESPONDENT)

Revenue by:- Sh. B. R. R. Kumar, Sr. DR. Assessee by:- Sh. Akhilesh Kumar, Adv. Date of Hearing: 04/06/2015 Date of Pronouncement: 05/06/2015

ORDER

PER R. S. SYAL, AM :

This appeal by the Revenue emanates from the order passed by

the CIT(A) on 30.11.2011 in relation to the assessment year 2008-09.

2. The only issue raised in this appeal is against the deletion of

addition of Rs.1,36,25,630/- made by the Assessing Officer (AO) u/s

68 of the Income-tax Act, 1961 (hereinafter also called `the Act').

3. Briefly stated the facts of the case are that the assessee is Co-

operative Housing Society. It received a sum of Rs.2,07,01,120/-

during the year from its Members as advance against flats/land. The I.T.A .No.-532/Del/2012 2

AO called upon the assessee to furnish names and complete

addresses of the members/persons from whom these advances

amounting to Rs.2.07 crore were received. Such amount of Rs.2.07

crore was stated by the assessee to have been received from 94

persons who were members of the society. The assessee also

furnished details in respect of these persons. The AO issued notices

u/s 133(6) on 25 persons. Out of notices to such 25 persons who had

contributed more than Rs.3 lac, three notices were returned

unserved. In eleven cases the notices were served but no compliance

was made by the individual members. The details were submitted as

regards the remaining 11 members. The AO observed that the

assessee failed to prove the genuineness of the transactions in

respect of 14 cases. When pointed out to the assessee about non-

compliance by these 14 persons, the assessee submitted their

Membership applications, PAN Cards and other details as required.

The AO drew a chart of 10 persons on page 7 of the assessment

order with a total of Rs.41,40,000/- in respect of which the

necessary details were not submitted. He however, made addition of I.T.A .No.-532/Del/2012 3

Rs.1,38,25,650/-. The assessee moved rectification application u/s

154 of the Act pointing out several mistakes in the order. The AO

passed an order u/s 154 accepting the claim of the assessee, inter

alia, to the tune of Rs.2 lac and restricted this addition to Rs.1.36

crore. The ld. CIT(A), on appreciation of the entire material before

him, came to the conclusion that the assessee had rightly discharged

the onus cast upon it. He therefore, ordered for the deletion of this

addition, against which the Revenue has come up in appeal before

us.

4. We have heard the rival submissions and perused the relevant

material on record. It is observed that the assessee received

advances from 94 Members for flats/land to be allotted by the

assessee society. The assessee furnished necessary details in respect

of all the 94 persons. The AO chose to pick up 25 cases from whom

flat application money above Rs.3 lac. was received. He get satisfied

with the explanation tendered by the assessee in respect of 15

persons and accordingly tabulated 10 persons from whom total

receipt of advance was to the tune of Rs.41.40 lac on which he was I.T.A .No.-532/Del/2012 4

not satisfied. However, at the time of computing total income, he

made an addition of Rs.1.38 crore. How this magical figure of Rs.1.38

crore was determined, is not borne out of the assessment order. The

ld. DR, in all fairness restricted his arguments in respect of 10

persons from whom the assessee had received advances of Rs.41.40

lac. Here is a case in which the assessee is a Co-operative Housing

Society, which received advances from the prospective buyers of

flats/houses. Complete details of all the 94 persons were furnished

which contained original applications, identity proofs and even in

some cases copies of bank statements of the persons and the income

tax returns. It can be observed that out of 10 persons listed by the

AO in the Table, the assessee furnished bank account/ITRs in case of

Shri Harshil Gupta, Shri Jitendra Kumar, Shri Kapil Gupta, Shri Madan

Lal and Shri Tarni Prasad Mishra. The AO did not find any fault with

the Members' files produced by the assessee before him along with

the necessary details about the receipt of advance against allotment

of flats/house. The ld. CIT(A) has recorded a categorically finding that

90% of the amount was received through banking transactions. I.T.A .No.-532/Del/2012 5

During the course of assessment proceedings, the assessee

expressed its inability to produce all members before the AO, but no

action was taken by the Officer for enforcing their attendance. If the

AO was not satisfied with the information made available by the

assessee qua these Members, he ought to have given a logical

conclusion to the inquiry directly initiated by him from these

persons. Nothing of the sort has been done in the instant case.

Considering the totality of facts and circumstances in the instant

case, we are of the considered opinion that the ld. CIT(A) was

justified in deleting this addition. We therefore, uphold the

assessment order on this score.

5. In the result, the appeal is dismissed.

Order pronounced in the open Court on /06/2015.

Sd/- Sd/-

(H. S. SIDHU) (R. S. SYAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 05/06/2015

*AK VERMA*

Copy forwarded to: I.T.A .No.-532/Del/2012 6

1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT

ASSISTANT REGISTRAR

Initial Date

1. Draft dictated on PS 04/06/2015

2. Draft placed before author 05/06/2015 PS

3. Draft proposed & placed before JM/AM the second member 05/06/2015

4. Draft discussed/approved by JM/AM Second Member.

5. Approved Draft comes to the PS/PS Sr.PS/PS 05/06/2015

6. Kept for pronouncement on PS

7. File sent to the Bench Clerk PS 05/06/2015

8. Date on which file goes to the AR

9. Date on which file goes to the Head Clerk.

10. Date of dispatch of Order. *